AUSTIN – Faced with increasing public anger over surprise medical bills, Texas doctors and health insurance companies are turning to a new tactic to try to help shape conversations over potential future regulations: blaming each other.
In a series of news releases and statements this week, two of the most powerful groups in the state medical community ended what had amounted to a public truce over so-called “balance billing.”
The phenomenon occurs when a patient is treated at a facility that has agreed to be in the network of his or her insurance plan but is treated by at least one medical professional who has not agreed to be part of the network. Because in-network care is significantly discounted, the gap can leave unsuspecting consumers with thousands of dollars worth of bills, especially in emergencies, when they cannot ask about networks.
Balance billing has been a nationwide problem for years but has gained a higher profile in recent months. The issue also became a more likely target for reform in Texas this year when lawmakers passed a limited set of protections despite consternation from the medical community – grumbling that largely played out behind the scenes at the Capitol.
The more public fighting began with a study by America’s Health Insurance Plans that found that Texas emergency-room doctors were charging out-of-network patients more than six times the rate that Medicare pays. The Texas Association of Health Plans, which represents health insurance companies operating in the state, announced the study in a news release, suggesting doctors were refusing to join networks so they could “inflate medical charges” to make more money.
The Texas Medical Association, which represents doctors, responded by releasing a statement calling the study “a desperate smoke screen to divert attention from the real problem.” President Tom Garcia said other studies have found that 73 percent of Texas insurance networks are “small,” data he said indicated the companies were being unreasonable in their offers of in-network rates to doctors in an attempt to save money.
“The health insurance industry games the system to keep more of patients’ premium dollars by forcing patients to seek care out-of-network. Then they have the gall to criticize what some doctors bill for that care,” Garcia said.
The Texas Hospital Association, another large industry group, declined to comment.
Advocates for consumers decried the back-and-forth, saying it amounted to two powerful business interests engaging in a fight without regard for patients caught in the cross-fire.
“This is more of the same from these guys,” said Blake Hutson, a Texas-based health care expert for the national Consumer’s Union advocacy group. “Guess who is stuck in the middle?”
In reality, said Hutson and other experts, both doctors and insurance companies are to blame – as are hospitals, to a lesser extent.
That is because physician shortages have increasingly led hospitals to fill their emergency rooms with contracted doctors, not facility employees who would be subject to the network. Insurance companies, meanwhile, have focused more on maximizing value of their in-network care but struggled to maintain adequate networks. And doctors have less incentive to join networks if they work in an emergency room and thus are likely to see patients even if they are not steered there by insurers.
A report released last year by the Center for Public Policy Priorities, a liberal-leaning think tank based in Austin, found that about half of charges billed by doctors in an in-network emergency room in Texas are charged as out-of-network. Nearly two dozen hospitals, the report found, do not have any ER doctors in network for any of the state’s three largest insurance providers.
In response, Texas lawmakers this year passed Senate Bill 481, which expanded a mediation process to patients who received a balance bill of at least $500. Previously, mediation was only available to patients who received a bill of at least $1,000.
But the bill only passed after being significantly watered down from its initial proposal to allow anybody to pursue mediation.
The Texas Medical Association opposed the bill most fiercely, although it eventually relented, Hutson said.
Stacey Pogue, a senior policy analyst at the Center for Public Policy Priorities, said she hopes different interest groups work together more in the future.
“Surprise medical bills aren’t one party’s fault; there is plenty of blame to go around,” Pogue said. “Doctors, hospitals, and insurers need to stop blaming each other and come to the table with real solutions.”